Sirwin
Sirwin
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Pros and Cons of Crowdfunded Property Investing


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WHY YES?

  • Capable of entering a high-cost asset class with small sums of money
  • Hassle-free investing: no need for personal property administration because everything is taken care of
  • Documents, including the title deed, are given to investors after they have been lodged with the regulatory authorities
  • Capable of diversifying property locations and investing in a number of high-yielding locations
  • Diversification and modest minimums can lessen risk even in a weak property market
  • No prior experience is required: To get started, you don’t need to know much
  • Spreading Risk: Because you can invest with less, you can spread your investments across multiple opportunities
  • Have a Say: Many crowdfunding sites allow you to choose which tenants to accept and when to raise rents, among other things

 

WHY NOT?

  • Low liquidity: this is true for the entire asset class: the average time to exit is 5 years (for the early exit you must request the company and wait for someone in the pool to buy your stake)
  • Property valuations change, and management costs apply: this is true for the entire asset class
  • No say in property purchase/management/sale decisions this is especially true for crowdfunded real estate projects
  • Inability to examine the property in person: unrealistic when crowdfunding anything
  • Tie-Ins: While some sites allow you to exit investments early, there is often a penalty for doing so
  • Lower relative returns: One potential disadvantage is that your return will typically be lower than if you invested directly in real estate through ownership

   

REFERENCE

  1. https://www.propertyroad.co.uk/pros-and-cons-property-crowdfunding/
  2. https://trustabcapital.com/pros-cons-real-estate-crowdfunding/

   

DISCLOSURE:

None of these articles constitutes financial advice. Articles are highly summarised to make it easy for the reader and save your time, so please DYOR further before putting your hard-earned money into any product mentioned.

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TheNiftyRevolution
TheNiftyRevolution

Hi, I'm Mo and I'm an entrepreneur passionate about crypto, NFTs, and the blockchain. This publication aims to educate the masses on adopting Web 3.0 early before it's too late :) I'm here to write, if it takes off, thanks a lot fam, if not thanks still


BuyPropertyEasy
BuyPropertyEasy

This is a publication sharing our experiences in real estate investing, as well as research summaries and reviews on products and services that have helped us invest wisely, reduce risk, diversify better, and aim for the highest returns in the shortest time.

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